Methodologies for assessing infrastructure projects under public-private partnerships : from project financing to maintenance scheduling
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Public-Private Partnerships (PPPs) are gaining increasing popularity and acceptance worldwide in delivering public infrastructure services. A combination of scarcity of public funds, the never-ending quest of private investors for new and profitable investment opportunities, and the undisputable need for new capacity and/or improvements in most public infrastructure is fostering this worldwide trend. PPPs, which introduce private capital and expertise in public infrastructure projects, are an efficient and cost-effective financing mechanism to solve this budgetary shortage problem while ensuring the best value for money. Even though researchers and scholars have made great efforts to explore this innovative area, there are still problems unsolved that need to be investigated. This dissertation proposes three methodological frameworks in a logical way to solve a sequence of issues associated with PPP projects so that all the stakeholders involved can make more insightful decisions. First, this dissertation presents a systematic genetic-algorithm-based methodology to minimize public funds employed and thus optimize the capital structure that reflects the characteristics of project financing and aims for win-win–win results for public authorities, equity investors, and lenders. Subsequently, a Monte Carlo Simulation based methodological framework for assessing the investment risks of PPP toll highway projects is proposed, where decision makers can obtain direct information to estimate the project’s overall financial risks and develop corresponding risk control measures. Finally, the dissertation applies the Fourth Order Method of Moments to determine optimal pavement preventive maintenance intervals based on reliability theory, contributing to cases where the distributions for characterizing variable uncertainties are unknown or difficult to obtain due to incomplete data. Therefore, a series of PPP problems is scrutinized: from project capital structure to investment risk assessment, and finally to the scheduling of preventive maintenance activities. Three case studies were conducted to illustrate the proposed methodologies. The insightful findings can be used by all stakeholders and decision makers to support their decision processes and negotiations toward a PPP infrastructure project for successful implementation.